The FINANCIAL — The Affordable Care Act (ACA) is already resulting in higher costs of health coverage and businesses have cut full-time jobs, despite the one-year delay of the employer mandate, according to the research released by the International Franchise Association (IFA) and the U.S. Chamber of Commerce.
The research also shows when fully implemented, the employer mandate will result in large chunks of both franchise and non-franchise businesses no longer providing health coverage for their employees.
The new survey, conducted by Public Opinion Strategies, focuses on more than 400 businesses with 40 to 500 employees. Businesses of this size account for more than 42 million jobs and employ 25 percent of all Americans. The research shows that 31 percent of franchise and 12 percent of non-franchise businesses report they have already reduced worker hours because of the impending law, more than a full year before the employer mandate goes into effect. Additionally, 27 percent of franchise and 12 percent of non-franchise businesses have already replaced full-time workers with part-time employees because of the law.
“This research clearly confirms what the anecdotal stories have already conveyed. Small business owners are already cutting full-time jobs and reducing hours for many of their employees due to the ACA,” said Steve Caldeira, IFA President & CEO. “This research should serve as a major red flag to Congress and the administration that unless there is a statutory change to the definition of a full-time employee in the ACA, there will be fewer full-time jobs, more part-time workers and fewer overall hours available for Americans to work as business owners adjust their workforce to comply with the law,” he added.
“Instead of providing affordable health care coverage to employees, the law will effectively take hours and wages away from Americans who need and want full-time jobs,” said Bruce Josten, executive vice president for Government Affairs at the U.S. Chamber. “That’s bad for businesses and their employees," he added.
The research also shows that the ACA’s employer mandate will have a huge impact on businesses with 40 to 70 employees. Among those business owners, 59 percent of franchises and 52 percent of non-franchises, say that they “will make personnel changes to stay below the 50 full-time equivalent threshold.”
Sixty-four (64) percent of business decision-makers in franchise-owned businesses and 53 percent of non-franchisee-owned businesses believe the ACA will have a negative impact on their businesses.
Twenty-nine (29) percent of franchise and 41 percent of non-franchise businesses are already seeing health care costs increase due to the law.
Twenty-eight (28) percent of franchise and non-franchise businesses surveyed report that the employer mandate will mean they will drop coverage for their employees. In effect, among this segment of businesses, the employer mandate will almost double the percentage of franchise-owned businesses and more than triple the percentage of non-franchise businesses that will not offer health care, according to the report.
Discussion about this post